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Purpose The purpose of this paper is to analyze underpricing in initial coin offerings (ICO). It bridges the gap between findings in initial public offering (IPO) literature and empirical results from ICOs. Design/methodology/approach The sample set consists of 279 ICOs between April 2013 and January 2018. A regression analysis is performed with data from the ICOs. Findings The results show an average level of underpricing of ICOs of 123 percent in the USA and 97 percent in the other countries. The results for the US ICOs are significantly higher than for US IPOs on average and also higher than US IPOs at the beginning of the dot.com bubble. The authors also study the determinants of ICO underpricing. The authors use proxies based on asymmetric information from the IPO literature as well as ICO-related variables. First-day trading volume and a good sentiment on the ICO market go together with more ICO underpricing. Moreover, hot markets make first-day investors to benefit less. Finally, companies that use a large issue size or a pre-ICO (a sale of cryptocurrencies before the ICO) leave less money on the table. Research limitations/implications A first restriction is that the authors focus on ICOs and not on crowdfunding, though there are similarities in that both of them are novel ways to finance projects. A second restriction is that the authors had to decide on the definition of a listing day. Cryptocurrencies are traded on many exchanges, and if the exchange is tailored to the cryptocurrency itself, the data on, e.g., close prices are not necessarily to be trusted. The authors, therefore, decided to use close price data from coinmarketcap.com, which requires a listing on two exchanges. This choice implies that there may have been trades before the listing day itself. A third restriction arises from the relative newness of the ICO phenomenon. The authors gathered data on underpricing from coinmarketcap.com and combined that with project information from icobench.com. However, the data were not simply matched and they required manual adjustments based on several other sources. The authors hope that in due time data on ICOs will be as adequate as data on IPOs and that they become more readily available. It might help if regulators or the crypto community would institute publication requirements. Adherence to such requirements would also reduce the extent of fraud and of asymmetric information, so that solid issuers with good projects might benefit from less underpricing. Practical implications The research may help in reducing underpricing, as the authors find that issuers can reduce it by holding a pre-ICO and by considering larger issue sizes. If they do so, investors will get fewer opportunities to benefit from underpricing. Investors can, nevertheless, also profit from the knowledge generated in this paper. When market sentiment is positive and first-day trading volume is expected to be high, investing in ICOs is likely to give them higher first-day returns. Finally, the authors hope that this paper will serve as a basis for further research into the exciting and dynamic world of cryptocurrencies. Originality/value There is hardly any research on underpricing of ICOs. The paper is interesting for its table with a brief comparison of ICOs and IPOs. It also searches for variables from the asymmetric information theory behind IPOs to be applied in explaining ICOs. It shows high levels of ICO underpricing in comparison to IPOs. It also gives suggestions for issuers of (and investors in) ICOs.

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Wim Wester man and Henk von Eije, Uni ver sity of Gron in gen 1 , 9700 AV Gron in gen, The Neth er lands, Ab stractLib er ali sa tion and de regu la tion of fi nan cial mar kets, lower cur rency vola til ity and the intro duc tion of the euro have re duced trans ac tion and bank ruptcy costs for mul ti na tion als in Europe. In ter nal Euro pean trans fers of cash have be come eas ier and cheaper. This has enabled the cen trali sa tion of cash man age ment ac tivi ties. The cen trali sa tion at head quar ters of mul ti na tional en ter prises has also opened the road to fi nan cial dis in ter me dia tion. These trends may have helped to cre ate con glom er ate bene fits in Europe. The case of the cash man age ment at the Netherlands-based Royal Phil ips Elec tron ics is used to il lus trate these ten den cies. Key words: lib er ali sa tion, de regu la tion, euro, Euro pean Un ion, mul ti na tion als, cash manage ment, cen trali sa tion, dis in ter me dia tion, con glom er ate dis counts

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